All posts tagged lending

We recently talked about forming your property management dream team and today we are excited to bring you a guest post from a mortgage consultant.

Mandy Mulligan, has been in the lending business since 2005. As a Mortgage Consultant for Citywide Home Loans, she specializes in helping people into their dream property in Northern Colorado. A majority of her business comes via referrals from past clients, friends, and business partners. If you are looking for help with your financing needs, Mandy has access to the many resources Citywide Home Loans offers to close your loan smoothly.

We’ll let Mandy take it away…

As many of you know, getting a mortgage loan these days isn’t easy.  To make a refinance or purchase easier, be prepared to provide 2 years W2′s and tax returns, the last 2 months of pay stubs, the last 2 months of bank statements, and document any large deposits that aren’t from a paycheck. Undocumented large deposits cause problems, so don’t deposit large sums of cash for 2 months before you get a loan! Then be prepared to provide more documentation after the underwriter has reviewed your file.

You also want to be prepared to pay for your appraisal up front.  Mortgage professionals used to be able to do research before an appraisal was ordered to make sure value was there before you spent $400-$500 on an appraisal, but now it is illegal for mortgage professionals to talk to an appraiser at any point in time during the loan process. So borrowers now risk spending the money for an appraisal without knowing that the value will come in where you need it to.

Don’t hide anything during the process, especially if it has to do with your income. Lenders now pull your tax transcripts from the IRS to make sure what you reported to the IRS is equal to the information you gave to us.  Underwriters do a lot of research now, especially on self employed borrowers so you won’t get anything past them.  If you are a self employed person looking to buy in the next year or so, make sure you don’t write everything off. We have to use an average of the last 2 years tax returns to figure your income.

You also have to have less than a 45% debt-to-income ratio to get a loan these days. Your debt-to-income ratio is what you owe in payments (car payments, house payments, student loans, credit cards, and any other loans that will report to your credit report) divided by your gross income.  That number must be at or less than 45% now.

To determine if you should refinance, you would need a mortgage professional to run the numbers to see if you are saving enough money and recouping the closing costs in 2 years or less. Typically, lowering your rate by 1 point would be beneficial. If you can go from a 30 year fixed loan to a 15 year fixed loan and keep the same payment amount, it would save you thousands of dollars in interest and should be considered. Other things to look for are refinancing out of an adjustable rate mortgage (ARM), given that rates are low and you just don’t know where the market is going to be when that rate adjusts down the road. Unless you plan to sell within the amount of years the ARM is fixed, I recommend a fixed rate loan.

I hope you found this helpful, please feel free to call me anytime if you have questions!

Mandy Mulligan
Mortgage Consultant
Citywide Home Loans

Cell: 970-980-4213
Email: Mandymulliganchlcc

Check the license status of your mortgage loan originator at http://www.dora.state.co.us/real-estate/index.htm

Direct Line: 970-776-3758
NMLS  ID: 271368  License # 100009066
Equal Opportunity Lender

Photo by: Doug Dugdale